SEC Filing | The ODP Corporation

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 F O R M 10 - Q/A (X) QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended March 31, 1999 ( ) TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from ___________ to _____________ Commission File Number: 1-5057 BOISE CASCADE CORPORATION (Exact name of registrant as specified in its charter) Delaware 82-0100960 (State or other jurisdiction of (I.R.S. Employer incorporation or organization) Identification No.) 1111 West Jefferson Street P.O. Box 50 Boise, Idaho 83728-0001 (Address of principal executive offices) (Zip Code) (208) 384-6161 (Registrant's telephone number, including area code) Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes X No ___ Indicate the number of shares outstanding of each of the issuer's classes of common stock, as of the latest practicable date. Shares Outstanding Class as of April 30, 1999 Common stock, $2.50 par value 56,525,108

PART I - FINANCIAL INFORMATION BOISE CASCADE CORPORATION AND SUBSIDIARIES STATEMENTS OF INCOME (LOSS) (expressed in thousands, except per share data) Item 1. Financial Statements Three Months Ended March 31 ________________________ 1999 1998 __________ __________ (unaudited) Sales $1,611,153 $1,489,500 __________ __________ Costs and expenses Materials, labor, and other operating expenses 1,253,623 1,172,920 Depreciation, amortization, and cost of company timber harvested 69,035 70,280 Selling and distribution expenses 182,896 161,700 General and administrative expenses 29,986 36,590 Other (income) expense, net 6,367 340 __________ __________ 1,541,907 1,441,830 __________ __________ Equity in net income (loss) of affiliates 746 (3,540) __________ __________ Income from operations 69,992 44,130 __________ __________ Interest expense (37,117) (40,100) Interest income 616 600 Foreign exchange gain (loss) 44 (50) __________ __________ (36,457) (39,550) __________ __________ Income before income taxes, minority interest, and cumulative effect of accounting change 33,535 4,580 Income tax provision (14,043) (1,900) __________ __________ Income before minority interest and cumulative effect of accounting change 19,492 2,680 Minority interest, net of income tax (3,339) (3,130) __________ __________ Income (loss) before cumulative effect of accounting change 16,153 (450) Cumulative effect of accounting change, net of income tax - (8,590) __________ __________ Net income (loss) $ 16,153 $ (9,040) ========== ========== Net income (loss) per common share Basic net income (loss) before cumulative effect of accounting change $ .23 $ (.17) Cumulative effect of accounting change - (.15) __________ __________ Basic net income (loss) $ .23 $ (.32) ========== ========== Diluted net income (loss) before cumulative effect of accounting change $ .22 $ (.17) Cumulative effect of accounting change - (.15) __________ __________ Diluted net income (loss) $ .22 $ (.32) ========== ========== The accompanying notes are an integral part of these Financial Statements.

BOISE CASCADE CORPORATION AND SUBSIDIARIES BALANCE SHEETS (expressed in thousands) ASSETS March 31 December 31 _______________________ ___________ 1999 1998 1998 __________ __________ ___________ (unaudited) Current Cash $ 48,526 $ 86,002 $ 66,469 Cash equivalents 8,349 8,840 7,899 __________ __________ __________ 56,875 94,842 74,368 Receivables, less allowances of $10,411, $8,874, and $10,933 592,746 630,448 526,359 Inventories 561,490 614,772 625,218 Deferred income tax benefits 88,802 59,459 92,426 Other 70,535 27,223 50,035 __________ __________ __________ 1,370,448 1,426,744 1,368,406 __________ __________ __________ Property Property and equipment Land and land improvements 62,732 55,445 63,307 Buildings and improvements 583,003 559,732 575,509 Machinery and equipment 4,106,202 4,145,749 4,082,724 __________ __________ __________ 4,751,937 4,760,926 4,721,540 Accumulated depreciation (2,197,160) (2,130,519) (2,150,385) __________ __________ __________ 2,554,777 2,630,407 2,571,155 Timber, timberlands, and timber deposits 270,028 276,670 270,570 __________ __________ __________ 2,824,805 2,907,077 2,841,725 __________ __________ __________ Goodwill, net of amortization of $41,112, $27,733, and $37,327 493,114 446,646 501,691 Investments in equity affiliates 31,923 30,520 27,162 Other assets 229,394 225,935 232,115 __________ __________ __________ Total assets $4,949,684 $5,036,922 $4,971,099 ========== ========== ========== LIABILITIES AND SHAREHOLDERS' EQUITY Current Short-term borrowings $ 164,935 $ 211,900 $ 129,512 Current portion of long-term debt 122,285 52,839 161,473 Income taxes payable 1,560 - - Accounts payable 486,527 495,831 499,489 Accrued liabilities Compensation and benefits 124,046 121,001 130,480 Interest payable 32,653 35,526 36,166 Other 218,082 159,995 172,980 __________ __________ __________ 1,150,088 1,077,092 1,130,100 __________ __________ __________ Debt Long-term debt, less current portion 1,548,027 1,742,492 1,578,136 Guarantee of ESOP debt 155,731 176,823 155,731 __________ __________ __________ 1,703,758 1,919,315 1,733,867 __________ __________ __________ Other Deferred income taxes 253,999 229,542 257,360 Other long-term liabilities 296,299 223,972 301,920 __________ __________ __________ 550,298 453,514 559,280 __________ __________ __________ Minority interest 120,092 109,462 116,753 __________ __________ __________ Shareholders' equity Preferred stock -- no par value; 10,000,000 shares authorized; Series D ESOP: $.01 stated value; 5,236,527; 5,521,442; and 5,356,648 shares outstanding 235,644 248,465 241,049 Deferred ESOP benefit (155,731) (176,823) (155,731) Common stock -- $2.50 par value; 200,000,000 shares authorized; 56,391,396; 56,277,831; and 56,338,426 shares outstanding 140,978 140,695 140,846 Additional paid-in capital 422,291 418,316 420,890 Retained earnings 796,767 853,781 791,618 Accumulated other comprehensive income (loss) (14,501) (6,895) (7,573) __________ __________ __________ Total shareholders' equity 1,425,448 1,477,539 1,431,099 __________ __________ __________ Total liabilities and shareholders' equity $4,949,684 $5,036,922 $4,971,099 ========== ========== ========== The accompanying notes are an integral part of these Financial Statements.

BOISE CASCADE CORPORATION AND SUBSIDIARIES STATEMENTS OF CASH FLOWS (expressed in thousands) Three Months Ended March 31 ________________________ 1999 1998 _________ _________ (unaudited) Cash provided by (used for) operations Net income (loss) $ 16,153 $ (9,040) Cumulative effect of accounting change, net of income tax - 8,590 Items in net income (loss) not using (providing) cash Equity in net (income) loss of affiliates (746) 3,540 Depreciation, amortization, and cost of company timber harvested 69,035 70,280 Deferred income tax provision (benefit) 10,463 (1,811) Minority interest, net of income tax 3,339 3,130 Restructuring charges 4,400 - Other 41 (1,139) Receivables (66,387) (58,485) Inventories 64,349 19,707 Accounts payable and accrued liabilities 13,389 35,463 Current and deferred income taxes (7,645) (955) Other (10,363) 12,576 _________ _________ Cash provided by operations 96,028 81,856 _________ _________ Cash provided by (used for) investment Expenditures for property and equipment (48,380) (62,548) Expenditures for timber and timberlands (392) (2,751) Purchases of assets (6,328) (4,042) Other (12,510) (10,884) _________ _________ Cash used for investment (67,610) (80,225) _________ _________ Cash provided by (used for) financing Cash dividends paid Common stock (8,451) (8,433) Preferred stock (80) (3,722) _________ _________ (8,531) (12,155) Short-term borrowings 35,423 117,100 Additions to long-term debt 105,921 90,000 Payments of long-term debt (174,673) (50,246) Series F Preferred Stock redemption - (115,001) Other (4,051) (73) _________ _________ Cash provided by (used for) financing (45,911) 29,625 _________ _________ Increase (decrease) in cash and cash equivalents (17,493) 31,256 Balance at beginning of the year 74,368 63,586 _________ _________ Balance at March 31 $ 56,875 $ 94,842 ========= ========= The accompanying notes are an integral part of these Financial Statements. NOTES TO QUARTERLY FINANCIAL STATEMENTS (1) BASIS OF PRESENTATION. We have prepared the quarterly financial statements pursuant to the rules and regulations of the Securities and Exchange Commission. Certain information and footnote disclosures normally included in financial statements prepared in accordance with generally accepted accounting principles have been condensed or omitted pursuant to such rules and regulations. These statements should be read together with the statements and the accompanying notes included in our 1998 Annual Report. The quarterly financial statements have not been audited by independent public accountants, but in the opinion of management, all adjustments necessary to present fairly the results for the periods have been included. The net income (loss) for the three months ended March 31, 1999 and 1998, necessarily involved estimates and accruals. Except as may be disclosed within these "Notes to Quarterly Financial Statements," the adjustments made were of a normal, recurring nature. Quarterly results are not necessarily indicative of results that may be expected for the year. (2) NET INCOME (LOSS) PER COMMON SHARE. Net income (loss) per common share was determined by dividing net income (loss), as adjusted, by applicable shares outstanding. For the three months ended March 31, 1998, the computation of diluted net loss per share was antidilutive; therefore, amounts reported for basic and diluted loss were the same. Three Months Ended March 31 ___________________ 1999 1998 ________ ________ (expressed in thousands) BASIC Net income (loss) as reported before cumulative effect of accounting change $ 16,153 $ (450) Preferred dividends(a) (3,490) (5,061) Excess of Series F Preferred Stock redemption price over carrying value(b) - (3,958) ________ ________ Basic income (loss) before cumulative effect of accounting change 12,663 (9,469) Cumulative effect of accounting change, net of income tax - (8,590) ________ ________ Basic income (loss) $ 12,663 $(18,059) ======== ======== Average shares outstanding used to determine basic income (loss) per common share 56,369 56,242 ======== ======== DILUTED Basic income (loss) before cumulative effect of accounting change $ 12,663 $ (9,469) Preferred dividends eliminated 3,490 - Supplemental ESOP contribution (2,983) - ________ ________ Diluted income (loss) before cumulative effect of accounting change 13,170 (9,469) Cumulative effect of accounting change, net of income tax - (8,590) ________ ________ Diluted income (loss) $ 13,170 $(18,059) ======== ======== Average shares outstanding used to determine basic income (loss) per common share 56,369 56,242 Stock options, net 235 - Series D convertible preferred stock 4,276 - ________ ________ Average shares used to determine diluted income (loss) per common share 60,880 56,242 ======== ======== (a) Dividend attributable to our Series D convertible preferred stock held by our ESOP (Employee Stock Ownership Plan) is net of a tax benefit. (b) First quarter 1998 loss per share included a negative seven cents related to the redemption of the Series F Preferred Stock. The loss for the quarter used in the calculation of loss per share was increased by the excess of the amount paid to redeem the preferred stock over its carrying value. (3) COMPREHENSIVE INCOME (LOSS). Comprehensive income (loss) for the periods include the following: Three Months Ended March 31 ____________________ 1999 1998 ________ ________ (expressed in thousands) Net income (loss) $ 16,153 $ (9,040) Other comprehensive income (loss) Cumulative foreign currency translation adjustment, net of income taxes (6,928) 1,715 ________ ________ Comprehensive income (loss), net of income taxes $ 9,225 $ (7,325) ======== ======== (4) RECEIVABLES. In late September 1998, we sold fractional ownership interests in a defined pool of trade accounts receivable. At March 31, 1999, and December 31, 1998, $100 million and $79 million of sold accounts receivable were excluded from receivables in the accompanying balance sheets. The portion of fractional ownership interest retained by us is included in accounts receivable in the balance sheets. The increase in sold accounts receivable over the amount at December 31, 1998, also represents an increase in cash provided by operations for the three months ended March 31, 1999. This program represents a revolving sale of receivables committed to by the purchasers for 364 days and is subject to renewal. Costs related to the program are included in "Other (income) expense, net" in the Statements of Income (Loss). Under the accounts receivable sale agreement, the maximum amount available from time to time is subject to change based on the level of eligible receivables, restrictions on concentrations of receivables, and the historical performance of the receivables we sell. (5) DEFERRED SOFTWARE COSTS. We defer certain software costs that benefit future years. These costs are amortized on the straight-line method over a maximum of five years or the expected life of the software, whichever is less. "Other assets" in the balance sheets includes deferred software costs of $48.2 million, $33.0 million, and $47.1 million at March 31, 1999 and 1998, and December 31, 1998. AICPA Statement of Position 98-1, "Accounting for the Costs of Computer Software Developed or Obtained for Internal Use," became effective beginning in 1999. We account for software costs in accordance with this statement. The implementation of this statement had no financial statement impact on us. (6) INVENTORIES. Inventories include the following: March 31 December 31 __________________ ___________ 1999 1998 1998 ________ ________ ___________ (expressed in thousands) Finished goods and work in process $437,340 $474,285 $456,577 Logs 46,760 66,062 87,688 Other raw materials and supplies 141,350 152,198 145,319 LIFO reserve (63,960) (77,773) (64,366) ________ ________ ________ $561,490 $614,772 $625,218 ======== ======== ======== (7) CUMULATIVE EFFECT OF ACCOUNTING CHANGE. As of January 1, 1998, we adopted the provisions of a new accounting standard, AICPA Statement of Position 98-5, "Reporting on the Costs of Start-Up Activities," which required the write-off of previously capitalized preoperating costs. Adoption of this standard resulted in a charge for the cumulative effect of accounting change, net of tax, of $8.6 million, or 15 cents per basic and diluted loss per share, for the three months ended March 31, 1998. (8) INCOME TAXES. We used an estimated annual tax rate of 41.9% and 41.5% for the three months ended March 31, 1999 and 1998. In 1998, our actual annual tax benefit rate was 5.7%. Excluding nonroutine items in 1998, the tax provision rate would have been 44%. Our tax rate is subject to fluctuations due primarily to the sensitivity of the rate to low income levels, the impact of nonroutine items, and the mix of income sources. For the three months ended March 31, 1999, we paid income taxes, net of refunds received, of $5.5 million. We paid $2.4 million for the same period in 1998. (9) DEBT. At March 31, 1999, we had a revolving credit agreement with a group of banks that permits us to borrow as much as $600 million at variable interest rates based on customary indices. This agreement expires in June 2002. The revolving credit agreement contains financial covenants relating to minimum net worth, minimum interest coverage ratios, and ceiling ratios of debt to capitalization. Under this agreement, the payment of dividends is dependent upon the existence of and the amount of net worth in excess of the defined minimum. Our net worth at March 31, 1999, exceeded the defined minimum by $110 million. At March 31, 1999, there were $160 million of borrowings outstanding under this agreement. Our majority-owned subsidiary, Boise Cascade Office Products Corporation ("BCOP"), has a $450 million revolving credit agreement with a group of banks that expires in June 2001 and provides variable interest rates based on customary indices. The BCOP revolving credit facility contains customary restrictive financial and other covenants, including a negative pledge and covenants specifying a minimum fixed charge coverage ratio and a maximum leverage ratio. BCOP may, subject to the covenants contained in the credit agreement and to market conditions, raise additional funds through the agreement and through other external debt or equity financings in the future. Borrowings under BCOP's agreement were $165 million at March 31, 1999. In October 1998, we entered into an interest rate swap with a notional amount of $75,000,000 and an effective fixed rate of 5.1% with respect to $75,000,000 of our revolving credit agreement borrowings. BCOP also entered into an interest rate swap with a notional amount of $25,000,000 and an effective fixed interest rate of 5.0% with respect to $25,000,000 of their revolving credit agreement borrowings. Both swaps expire in 2000. We are exposed to credit-related gains or losses in the event of nonperformance by counterparties to these swaps; however, we do not expect any counterparties to fail to meet their obligations. Also at March 31, 1999, we had $104.3 million of short-term borrowings outstanding and BCOP had $60.6 million of short-term borrowings outstanding. At March 31, 1998, we had $138.1 million short-term borrowings outstanding, while BCOP had $73.8 million of short-term borrowings outstanding. The maximum amount of short-term borrowings outstanding during the three months ended March 31, 1999 and 1998, was $293.3 million and $275.3 million. The average amount of short-term borrowings outstanding during the three months ended March 31, 1999 and 1998, was $177.6 million and $198.9 million. The average interest rate for these borrowings was 5.4% for 1999 and 5.9% for 1998. At March 31, 1999, we had $430.0 million and BCOP had $150.0 million of unused borrowing capacity registered with the Securities and Exchange Commission for additional debt securities. In March 1999, we filed a registration statement covering $300 million in universal shelf capacity with the Securities and Exchange Commission. This filing is still under review by the Securities and Exchange Commission. Once approved, we may offer and sell in one or more offerings common stock, preferred stock, debt securities, warrants, and purchase contracts. Cash payments for interest, net of interest capitalized, were $40.6 million and $43.7 million for the three months ended March 31, 1999 and 1998. (10) BOISE CASCADE OFFICE PRODUCTS CORPORATION. During the first three months of 1999, BCOP completed one acquisition, and during the first three months of 1998, BCOP completed two acquisitions, all of which were accounted for under the purchase method of accounting. Accordingly, the purchase prices were allocated to the assets acquired and liabilities assumed based upon their estimated fair values. The initial purchase price allocations may be adjusted within one year of the date of purchase for changes in estimates of the fair values of assets and liabilities. Such adjustments are not expected to be significant to our results of operations or our financial position. The excess of the purchase price over the estimated fair value of the net assets acquired was recorded as goodwill and is being amortized over 40 years. The results of operations of the acquired businesses are included in our operations subsequent to the dates of acquisition. On January 11, 1999, BCOP acquired the office supply business of Wallace Computer Services, based in Lisle, Illinois. This transaction was completed for cash of $6.3 million and the recording of $0.2 million of acquisition liabilities. On January 12, 1998, BCOP acquired the direct marketing business of Fidelity Direct, based in Minneapolis, Minnesota. On February 28, 1998, BCOP acquired the direct marketing business of Sistemas Kalamazoo, based in Spain. These transactions were completed for cash of $4.0 million, debt assumed of $0.2 million, and the recording of $3.8 million of acquisition liabilities. Unaudited pro forma results of operations reflecting the above acquisitions would have been as follows. If the 1999 acquisition had occurred on January 1, 1999, there would be no significant change in the results of operations for the first three months of 1999. If the 1999 and 1998 acquisitions had occurred on January 1, 1998, sales for the first three months of 1998 would have increased by $12 million, net loss and basic and diluted loss per share would have been unchanged. This unaudited pro forma financial information does not necessarily represent the actual results of operations that would have occurred if the acquisitions had taken place on the dates assumed. (11) NEW ACCOUNTING STANDARDS. In June 1998, the Financial Accounting Standards Board issued SFAS No. 133, "Accounting for Derivative Instruments and Hedging Activities." This Statement establishes accounting and reporting standards requiring that every derivative instrument (including certain derivative instruments embedded in other contracts) be recorded in the balance sheet as either an asset or liability measured at its fair value. This Statement is effective for fiscal years beginning after June 15, 1999. We plan to adopt this Statement in the first quarter of 2000. We are in the process of reviewing this new standard. Adoption of this Statement is not expected to have a significant impact on our results of operations or financial position. (12) RESTRUCTURING ACTIVITIES. Late in the second quarter of 1998, we adopted a plan to restructure our wood products manufacturing business and announced the permanent closure of four facilities, including sawmills in Elgin, Oregon; Horseshoe Bend, Idaho; and Fisher, Louisiana; and a plywood plant in Yakima, Washington. These closures are due to poor financial results and a decrease in wood supply. We closed the sawmills in Horseshoe Bend and Fisher in 1998. These closures resulted in the termination of 182 employees. Our current plans are to close the Elgin sawmill and Yakima plywood plant in 1999. However, based on recent changes in wood supply and costs, product prices, and plant operations, we are evaluating whether these facilities should continue to operate past 1999. Approximately 312 employees would be affected by the closure of the Elgin and Yakima facilities. These two facilities had sales of $13,871,000 and $11,545,000 for the three months ended March 31, 1999 and 1998. These facilities had operating income of $3,248,000 for the three months ended March 31, 1999, and an operating loss of $2,210,000 for the three months ended March 31, 1998. The Horseshoe Bend and Fisher sawmills had sales of $10,050,000 and an operating loss of $1,920,000 for the three months ended March 31, 1998. The assets still to be shut down were written down to zero, their estimated net realizable value at the then expected date of closure. Had we continued to depreciate these assets, first quarter 1999 operating expense would have increased approximately $1,000,000. Also in the second quarter of 1998, our paper and paper products segment recorded a pretax charge of $19.0 million related to the revaluation of paper-related assets. Included in the revaluation was the $8 million write-down to zero of our investment in a now terminated joint venture in China that produced carbonless paper. Also written down by approximately $5.0 million were the fixed assets of a small corrugating facility that was sold in March 1999 for its approximate remaining book value. We also wrote off $6.0 million in an investment in a bankrupt recycling joint venture and miscellaneous equipment that had no future value. In the fourth quarter of 1998, we announced a company-wide cost- reduction initiative and the restructuring of certain operations. Specific actions included the elimination of job positions in our manufacturing businesses and Boise headquarters through a combination of early retirements, layoffs, and attrition. Our paper research and development facility in Portland, Oregon, will close by June 1999. BCOP announced the closure of eight facilities in the United Kingdom and the integration of selected functions of the operations with their other United Kingdom operations. These BCOP closures are expected to be completed during the first half of 1999 and will result in work force reductions of approximately 140 employees. BCOP also dissolved an unprofitable joint venture in Germany. During first quarter 1999, we recorded $4.4 million of additional restructuring expense related to the early retirement program announced in fourth quarter 1998. This noncash charge was for the present value of unrecorded early retirement benefits. These charges were accrued when the retiring individuals legally accepted the early retirement offer. This additional expense decreased 1999 net income $2.7 million and basic and diluted income per share $0.04. Restructuring activities related to these 1998 charges through March 31, 1999, and the reserve balances as of that date are as follows: Asset Employee- Other Write- Related Exit Downs Costs Costs Total ________ ________ ________ ________ (expressed in thousands) SECOND QUARTER BUILDING PRODUCTS 1998 expense recorded $ 27,200 $ 14,000 $ 20,700 $ 61,900 Assets written down (27,200) - - (27,200) 1998 charges against reserve - (4,500) (1,300) (5,800) ________ ________ ________ ________ Restructuring reserve at December 31, 1998 - 9,500 19,400 28,900 1999 charges against reserve - (1,000) (100) (1,100) ________ ________ ________ ________ Restructuring reserve at March 31, 1999 $ - $ 8,500 $ 19,300 $ 27,800 ======== ======== ======== ======== PAPER AND PAPER PRODUCTS 1998 expense recorded $ 18,800 $ 200 $ - $ 19,000 Assets written down (18,800) - - (18,800) ________ ________ ________ ________ Restructuring reserve at December 31, 1998 - 200 - 200 1999 charges against reserve - (100) - (100) ________ ________ ________ ________ Restructuring reserve at March 31, 1999 $ - $ 100 $ - $ 100 ======== ======== ======== ======== FOURTH QUARTER OFFICE PRODUCTS 1998 expense recorded $ 300 $ 1,400 $ 9,400 $ 11,100 Assets written down (300) - - (300) 1998 charges against reserve - (200) (3,300) (3,500) ________ ________ ________ ________ Restructuring reserve at December 31, 1998 - 1,200 6,100 7,300 1999 charges against reserve - (400) (700) (1,100) ________ ________ ________ ________ Restructuring reserve at March 31, 1999 $ - $ 800 $ 5,400 $ 6,200 ======== ======== ======== ======== BUILDING PRODUCTS 1998 expense recorded $ - $ 2,800 $ - $ 2,800 Pension liability recorded - (2,200) - (2,200) 1998 charges against reserve - - - - ________ ________ ________ ________ Restructuring reserve at December 31, 1998 - 600 - 600 1999 charges against reserve - - - - ________ ________ ________ ________ Restructuring reserve at March 31, 1999 $ - $ 600 $ - $ 600 ======== ======== ======== ======== PAPER AND PAPER PRODUCTS 1998 expense recorded $ 7,200 $ 11,300 $ - $ 18,500 Assets written down (7,200) - - (7,200) Pension liability recorded - (4,500) - (4,500) 1998 charges against reserve - (800) - (800) ________ ________ ________ ________ Restructuring reserve at December 31, 1998 - 6,000 - 6,000 1999 charges against reserve - (1,800) - (1,800) ________ ________ ________ ________ Restructuring reserve at March 31, 1999 $ - $ 4,200 $ - $ 4,200 ======== ======== ======== ======== CORPORATE AND OTHER 1998 expense recorded $ - $ 5,200 $ 400 $ 5,600 Pension liability recorded - (3,200) - (3,200) 1998 charges against reserve - - - - ________ ________ ________ ________ Restructuring reserve at December 31, 1998 - 2,000 400 2,400 1999 expense recorded - 4,400 - 4,400 Pension liability recorded - (4,400) - (4,400) Reclass from other accounts - 500 - 500 1999 charges against reserve - (400) (100) (500) ________ ________ ________ ________ Restructuring reserve at March 31, 1999 $ - $ 2,100 $ 300 $ 2,400 ======== ======== ======== ======== TOTAL SECOND AND FOURTH QUARTER 1998 expense recorded $ 53,500 $ 34,900 $ 30,500 $118,900 Assets written down (53,500) - - (53,500) Pension liability recorded - (9,900) - (9,900) 1998 charges against reserve - (5,500) (4,600) (10,100) ________ ________ ________ ________ Restructuring reserve at December 31, 1998 - 19,500 25,900 45,400 1999 expense recorded - 4,400 - 4,400 Pension liability recorded - (4,400) - (4,400) Reclass from other accounts - 500 - 500 1999 charges against reserve - (3,700) (900) (4,600) ________ ________ ________ ________ Restructuring reserve at March 31, 1999 $ - $ 16,300 $ 25,000 $ 41,300 ======== ======== ======== ======== Charges against the reserve in other exit costs included approximately $4.0 million of costs to dissolve the BCOP joint venture in Germany, the write-down of contracts to their realizable value, and a small charge for tear-down costs. The estimated number of employees impacted by the 1998 restructuring activities described above and the number who have left the company as of March 31, 1999, are as follows: Employees To Employees Be Terminated Terminated _____________ __________ Second Quarter 1998 Building products 494 182 Fourth Quarter 1998 Office products 140 89 Building products 40 13 Paper and paper products 212 95 Corporate and other 92 21 ____ ____ Total 978 400 ==== ==== In addition to the employees discussed above, we expect to eliminate up to another 100 positions by not filling already vacant positions or through normal attrition. No reserves were established related to these job eliminations. (13) SEGMENT INFORMATION. There are no differences from our last annual report in our basis of segmentation or in our basis of measurement of segment profit or loss. An analysis of our operations by segment is as follows: Income (Loss) Before Taxes, Minority Interest, and Cumu- Sales lative ______________________________ Effect of Inter- Accounting Trade Segment Total Change (a) Three Months Ended ________ _______ ________ _______ March 31, 1999 (expressed in millions) Office products $ 848.3 $ .1 $ 848.4 $ 38.7 Building products 436.6 6.9 443.5 40.3 Paper and paper products 319.9 79.5 399.4 4.8 Corporate and other 6.4 14.2 20.6 (13.2) ________ _______ ________ _______ Total 1,611.2 100.7 1,711.9 70.6 Intersegment eliminations - (100.7) (100.7) - Interest expense - - - (37.1) ________ _______ ________ _______ Consolidated Totals $1,611.2 $ - $1,611.2 $ 33.5 ======== ======= ======== ======= Three Months Ended March 31, 1998 Office products $ 759.4 $ .4 $ 759.8 $ 36.5 Building products 358.1 10.6 368.7 (.2) Paper and paper products 367.1 91.2 458.3 20.6 Corporate and other 4.9 15.0 19.9 (12.2) ________ _______ ________ _______ Total 1,489.5 117.2 1,606.7 44.7 Intersegment eliminations - (117.2) (117.2) - Interest expense - - - (40.1) ________ _______ ________ _______ Consolidated Totals $1,489.5 $ - $1,489.5 $ 4.6 ======== ======= ======== ======= (a) Interest income has been allocated to our segments in the amounts of $616,000 for the three months ended March 31, 1999, and $600,000 for the three months ended March 31, 1998. ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS RESULTS OF OPERATIONS Our net income for the first quarter of 1999 was $16.2 million, compared with a net loss of $9.0 million for the first quarter of 1998. Basic income per common share for the first quarter of 1999 was 23 cents and diluted income per common share was 22 cents. For the same quarter in 1998, basic and diluted loss per common share were 32 cents. Sales for the first quarter of 1999 were $1.6 billion and $1.5 billion in first quarter of 1998. First quarter 1999 and 1998 results included the nonroutine items discussed below. First quarter 1999, included $4.4 million ($2.7 million after tax or $0.04 per basic and diluted share) of additional restructuring expense related to the early retirement program announced in fourth quarter 1998. This noncash charge was for the present value of unrecorded early retirement benefits. These charges were accrued when the retiring individuals legally accepted the early retirement offer. As of January 1, 1998, we adopted the provisions of a new accounting standard, AICPA Statement of Position 98-5, "Reporting on the Costs of Start-up Activities." This statement required the write-off of previously capitalized preoperating costs, which resulted in an after-tax charge of $8.6 million, or 15 cents per basic and diluted share. Also included in 1998 earnings per share is a negative seven cents per basic and diluted share related to the redemption of our Series F preferred stock. The following table shows the estimated increase in 1999 operating income as a result of our restructurings and other cost saving initiatives. Three Months Ended March 31, 1999 _________________ Cash Noncash ______ _______ Office Products Improved operating results of 1998 for restructured European locations $ - $ 1.3 Building Products 1998 operating losses for closed locations 1.5 0.4 Cost savings - - Paper and Paper Products Cost savings 8.7 0.3 Corporate and other Cost savings 1.0 - _____ _____ Total $11.2 $ 2.0 On an overall basis, materials, labor, and other operating expenses declined to 77.8% of sales for the three months ended March 31, 1999, compared to 78.7% of sales for the same period in 1998. The improvement is primarily due to the increased sales prices which increased sales without a corresponding increase in costs, and reduced wood and conversion costs in our Building Products segment. Selling and distribution expenses as a percent of sales were 11.4% of sales for the three months ended March 31, 1999, compared to 10.9% of sales for the three months ended March 31, 1998. This higher percentage is due primarily to the increasing Office Products sales which have higher associated selling and distribution costs. General and administrative expenses have decreased as a percentage of sales to 1.9% in first quarter 1999 compared to 2.5% in first quarter 1998. This decrease is due in part to our cost reduction efforts as well as leveraging fixed costs over higher sales. Interest expense was $37.1 million in the first quarter of 1999, compared with $40.1 million in the same period last year. The decrease was due primarily to slightly lower debt levels and lower effective interest rates. We used an estimated annual tax provision rate of 41.9% and 41.5% for the three months ended March 31, 1999 and 1998. In 1998, our actual annual tax benefit rate was 5.7%. Excluding nonroutine items in 1998, the tax provision rate would have been 44%. Our tax rate is subject to fluctuations due primarily to the sensitivity of the rate to low income levels, the impact of nonroutine items, and the mix of income sources. Operating income in the Office Products segment in the first quarter of 1999 was $38.7 million, compared to $36.6 million in the first quarter of 1998. Net sales in the first quarter of 1999 increased 12% to $848.4 million, compared with $759.8 million in the first quarter of 1998. The growth in sales resulted primarily from same-location sales growth and acquisitions. Same-location sales increased 8% in the first quarter of 1999, compared with the first quarter of 1998. Excluding the negative impact of paper price changes and foreign currency changes, same-location sales increased 10%. Cost of sales, which includes the cost of merchandise sold, the cost to deliver products to customers, and the occupancy costs of our facilities, increased to $629.3 million in the first quarter of 1999, which was 74.2% of net sales. This compares with $564.2 million reported in the same period of the prior year, which represented 74.3% of net sales. Gross profit as a percentage of net sales was 25.8% and 25.7% for the first quarters of 1999 and 1998. BCOP's operating expenses were 21.3% of net sales in the first quarter of 1999, compared with 21.0% in the first quarter of 1998. The increase in the first quarter of 1999 was due, in part, to additional payroll associated with the expansion of our U.S. sales force and support of our growth initiatives. Our Building Products segment had operating income of $40.3 million in the first quarter of 1999 compared to an operating loss of $0.2 million for first quarter 1998. Sales increased 20% to $443.5 million compared to $368.7 million a year ago. The increase is due to improved sales prices, very strong structural panel markets, over a 70% increase in engineered wood products sales, significant sales growth in building materials distribution, and an improved product mix through a reduction in commodity lumber volume. The increase in operating income was also due to lower wood and conversion costs. Average oriented strand board prices increased 28%, average plywood prices increased 18%, and average lumber prices increased 3% in the first quarter of 1999, compared with year-ago levels. These increases were offset by 4% lower average particleboard prices and 1% lower average laminated veneer lumber prices. Average I-joist prices were about flat. Plywood sales volume was down 62.1 million square feet, lumber was down 18.6 million board feet, laminated veneer lumber was up 0.6 million cubic feet, I-joist was up 11.9 million equivalent lineal feet, and particleboard was down 1.5 million square feet. Building materials distribution sales increased from $167.7 million to $224.2 million, or 34% in the first quarter 1999, compared with first quarter 1998. The increase in distribution sales was due both to higher prices and increased market share. Our Paper and Paper Products segment reported operating income of $4.8 million in the first quarter of 1999. In the first quarter of 1998, this segment recorded operating income of $20.6 million. Sales decreased 13% to $399.4 million in the first quarter of 1999 from $458.3 million in the first quarter of 1998. Performance decreased year over year primarily because of lower average prices for all of our paper grades in first quarter of 1999, compared with the first quarter of 1998. Uncoated free sheet prices decreased 12%, containerboard prices decreased 15%, newsprint prices decreased 5%, and pulp prices decreased 10%. Sales volume for the first quarter of 1999 decreased 18,000 tons to 634,000 tons, compared with 652,000 tons in first quarter 1998. Uncoated free sheet volumes decreased by 7,000 tons, containerboard sales volumes decreased by 8,000 tons, and newsprint volumes decreased by 9,000 tons. These decreases were offset by a 6,000-ton sales volume increase in pulp. Paper segment manufacturing costs per ton in the first quarter of 1999 were 6% lower than in the comparison quarter. The decrease was due to decreased fiber costs and lower fixed manufacturing costs. FINANCIAL CONDITION AND LIQUIDITY Operating Activities. Cash provided by operations was $96.0 million for the first three months of 1999, compared with $81.9 million for the same period in 1998. The increase in 1999 was due to improved operating results offset in part by uses of cash for working capital items. Also in September 1998, we sold fractional ownership interests in a defined pool of trade accounts receivable. At March 31, 1999, $100 million of the sold accounts receivable were excluded from receivables in the balance sheet. This is an increase of $21 million from the December 31, 1998, balance of $79 million. This increase represents an increase in cash provided by operations. Our working capital ratio was 1.19:1 at March 31, 1999, compared with 1.32:1 at March 31, 1998. Our working capital ratio was 1.21:1 at December 31, 1998. Investing Activities. Total capital investment for the first three months of 1999 and 1998 was $55.3 million and $73.1 million. Amounts include acquisitions made by BCOP through assumption of debt and recording of liabilities. Cash used for investment was $67.6 million and $80.2 million for the first three months of 1999 and 1998. Cash expenditures for property and equipment, and timber and timberlands, totaled $48.8 million and $65.3 million for the first three months of 1999 and 1998. This reduction reflects our focus on reducing our overall level of capital spending. Cash purchases of assets, primarily due to BCOP's expansion program, totaled $6.3 million for the first three months of 1999 and $4.0 million for the first three months of 1998. Financing Activities. Cash used for financing was $45.9 million for the first three months of 1999. Cash provided by financing was $29.6 million for the first three months of 1998. Dividend payments totaled $8.5 million and $12.2 million for the first three months of 1999 and 1998. The decrease is due to the redemption of our Series F preferred stock in February 1998. In both years, our quarterly dividend was 15 cents per common share. For the first three months of 1999, short-term borrowings, primarily notes payable and commercial paper, increased $35.5 million compared with an increase of $117.0 million for the first three months of 1998. The increase in short-term borrowings in first quarter 1998 was used to fund the redemption of the Series F preferred stock for $115 million in cash. At March 31, 1999, we had $104.3 million of short-term borrowings outstanding, and BCOP had $60.6 million of short- term borrowings outstanding. At March 31, 1998, we had $138.1 million of short-term borrowings outstanding, while BCOP had $73.8 million of short- term borrowings outstanding. At December 31, 1998, we had $57.4 million of short-term borrowings outstanding, while BCOP had $72.1 million of short-term borrowings outstanding. Long-term debt decreased $68.8 million in the first three months of 1999 and increased $39.8 million in the first three months of 1998. In February 1999, we redeemed our $100 million, 9.875% notes. At March 31, 1999 and 1998, we had $2.0 billion and $2.2 billion of debt outstanding. At December 31, 1998, we had $2.0 billion of debt outstanding. Our debt-to-equity ratio was 1.40:1 and 1.48:1 at March 31, 1999 and 1998. Our debt-to-equity ratio was 1.41:1 at December 31, 1998. Our debt and debt-to-equity ratio include the guarantee by the company of the remaining $155.7 million of debt incurred by the trustee of our leveraged Employee Stock Ownership Plan. While that guarantee has a negative impact on our debt-to-equity ratio, it has virtually no effect on our cash coverage ratios or on other measures of our financial strength. We have a revolving credit agreement with a group of banks that permits us to borrow as much as $600 million based on customary indices. As of March 31, 1999, borrowings under the agreement totaled $160 million. When the agreement expires in June 2002, any amount outstanding will be due and payable. In October 1998, we entered into an interest rate swap with a notional amount of $75 million that expires in 2000. This swap results in an effective fixed interest rate with respect to $75 million of our revolving credit agreement borrowings. The payment of dividends is dependent on the existence of and the amount of net worth in excess of the defined minimum under the agreement. As of March 31, 1999, we were in compliance with our debt covenants, and our net worth exceeded the defined minimum by $110 million. BCOP has a $450 million revolving credit agreement with a group of banks that expires in June 2001 and provides variable interest rates based on customary indices. In October 1998, BCOP entered into an interest rate swap with a notional amount of $25 million that expires in 2000. This swap results in an effective fixed interest rate with respect to $25 million of BCOP's revolving credit agreement borrowings. As of March 31, 1999, BCOP had outstanding borrowings of $165 million under this agreement and was in compliance with its debt covenants. At March 31, 1999, we had $430.0 million and BCOP had $150.0 million of unused borrowing capacity registered with the Securities and Exchange Commission. In March 1999, we filed a registration statement covering $300 million in universal shelf capacity with the Securities and Exchange Commission. This filing is still under review by the Securities and Exchange Commission. Once approved, we may offer and sell in one or more offerings common stock, preferred stock, debt securities, warrants, and purchase contracts. We expect the restructuring programs announced in 1998 to be cash flow positive in 1999. We estimate that the programs will require cash outlays before any savings of approximately $23 million in 1999. These expected cash payments in 1999 include $13 million for employee-related costs, $10 million for other exit costs including $7 million for lease and other contract terminations, and $2 million for tear-down and environmental costs. We spent approximately $4 million in first quarter 1999, including $3 million for employee-related costs and $1 million for lease and other contract terminations. Cash requirements related to our restructuring in 2000 and beyond are expected to total $17 million with most of that occurring in 2000 or early 2001. This and our other cash requirements will be funded through a combination of cash flows from operations, borrowings under our existing credit facilities, and issuance of new debt or equity securities. Our results of operations are not materially effected by seasonal sales variances or inflation. OUTLOOK The strong first quarter results by our building products business should continue through the year. We expect to grow office products distribution sales and income at double digit rates. This is a reflection of the better overall performance and strengthening margins in the first quarter, which will continue and benefit future results. It appears that the negative pressures from global economic turmoil which have had a negative impact on the paper business in the last few quarters may be waning or at least have stopped getting worse. Although business conditions in paper will continue to be challenging during the first half of this year, markets should gradually strengthen. Demand is on the upswing, and prices in some grades have started to rise as global markets for our key paper grades, uncoated free sheet and containerboard, work their way through the oversupply of pulp and paper caused by the Asian economic turmoil. We continue to have confidence in the long-term prospects in our paper business. Very little new capacity is being planned or constructed anywhere in the world. As global demand begins to recover, perhaps in the second half of 1999, we expect supply-and-demand balances in our paper businesses to tighten considerably. NEW ACCOUNTING STANDARDS In June 1998, the Financial Accounting Standards Board issued SFAS No. 133, "Accounting for Derivative Instruments and Hedging Activities." This Statement establishes accounting and reporting standards requiring that every derivative instrument (including certain derivative instruments embedded in other contracts) be recorded in the balance sheet as either an asset or liability measured at its fair value. We plan to adopt this Statement in the first quarter of 2000. We are in the process of reviewing this new standard. Adoption of this Statement is not expected to have a significant impact on our results of operations or financial position. TIMBER SUPPLY In recent years, the amount of timber available for commercial harvest in the United States has declined due to environmental litigation, changes in government policy, and other factors. More constraints on available timber supply may be imposed. As a result, we cannot accurately predict future log supply. In 1998, we closed sawmills in Fisher, Louisiana, and Horseshoe Bend, Idaho, partly because of reductions in timber supply and consequent increases in timber costs. Additional curtailments or closures of our wood products manufacturing facilities are possible. YEAR 2000 COMPUTER ISSUE Over the last two years, we have been replacing many of our business computer systems to realize cost savings and process improvements. These replacements, all of which are year 2000-compliant, will be completed before the year 2000. Many of the costs associated with these replacements have been and will be deferred and amortized over approximately five years. (See Note 5 in the Notes to Financial Statements.) A year 2000 compliance assessment was completed in 1998. Many of the existing systems were found to be compliant. We have begun appropriate modifications of the noncompliant systems. We expect to complete all necessary changes before year-end 1999. We are currently surveying our critical suppliers and customers to determine whether critical processes may be impacted by a lack of year 2000 compliance. Most of our critical suppliers and customers have confirmed that they are or have plans to be compliant by year-end 1999. Incremental costs to make our systems compliant are expected to range from $10 million to $13 million. These costs are being expensed as incurred. Approximately $6.4 million had been spent through March 31, 1999. The most reasonably likely worst-case scenario of failure by us or our suppliers or customers to be year 2000-compliant would be a temporary slowdown of manufacturing operations at one or more of our locations and a temporary inability to process orders and billings in a timely manner and to deliver products to our customers in a timely manner. We are currently developing contingency options in the event that critical systems or suppliers encounter unforeseen year 2000 problems. Those contingency options will be completed by mid-1999. Our discussion of the year 2000 computer issue contains forward-looking information. We believe that our critical computer systems will be year 2000-compliant and that the costs to achieve compliance will not materially affect our financial condition, operating results, or cash flows. Nevertheless, factors that could cause actual results to differ from our expectations include the successful implementation of year 2000 initiatives by our customers and suppliers, changes in the availability and costs of resources to implement year 2000 changes, and our ability to successfully identify and correct all systems affected by the year 2000 issue. FORWARD-LOOKING STATEMENTS This Management's Discussion and Analysis includes forward-looking statements. Because these forward-looking statements include risks and uncertainties, actual results may differ materially from those expressed in or implied by the statements. Factors that could cause actual results to differ include, among other things, changes in domestic or foreign competition; the severity and longevity of global economic disruptions; increases in capacity through construction of new manufacturing facilities or conversion of older facilities to produce competitive products; changes in production capacity across paper and wood products markets; variations in demand for our products; changes in our cost for or the availability of raw materials, particularly market pulp and wood; the cost of compliance with new environmental laws and regulations; the pace and the success of acquisitions; changes in same-location sales; cost structure improvements; the ability to implement operating strategies and integration plans and realize cost savings and efficiencies; fluctuations in foreign currency exchange rates; fluctuations in paper prices; the success and integration of new initiatives and acquisitions; the successful integration of systems; the success of computer-based system enhancements; and general economic conditions. ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK Changes in interest rates and currency rates expose the company to financial market risk. Our debt is predominantly fixed-rate. We experience only modest changes in interest expense when market interest rates change. Most foreign currency transactions have been conducted in the local currencies, limiting our exposure to changes in currency rates. Consequently, our market risk-sensitive instruments do not subject us to material market risk exposure. Changes in our debt and our continued international expansion could increase these risks. To manage volatility relating to these exposures, we may enter into various derivative transactions such as interest rate swaps, rate hedge agreements, and forward exchange contracts. Interest rate swaps and rate hedge agreements are used to hedge underlying debt obligations or anticipated transactions. For qualifying hedges, the interest rate differential is reflected as an adjustment to interest expense over the life of the swap or underlying debt. Gains and losses related to qualifying hedges of foreign currency firm commitments and anticipated transactions are deferred and are recognized in income or as adjustments of carrying amounts when the hedged transaction occurs. All other forward exchange contracts are marked to market, and unrealized gains and losses are included in current period net income. We had no material changes in market risk since December 31, 1998. We had no material exposure to losses from derivative financial instruments held at March 31, 1999. We do not use derivative financial instruments for trading purposes. PART II - OTHER INFORMATION ITEM 1. LEGAL PROCEEDINGS Reference is made to our annual report on Form 10-K for the year ended December 31, 1998, for information concerning legal proceedings. ITEM 2. CHANGES IN SECURITIES None. ITEM 3. DEFAULTS UPON SENIOR SECURITIES None. ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS We held our annual shareholders meeting on April 15, 1999. A total of 61,700,220 shares of common and preferred stock were outstanding and entitled to vote at the meeting. Of the total outstanding, 54,965,083 shares were represented at the meeting. Shareholders cast votes for election of the following directors whose terms expire in 2002: In Favor Withheld Not Voted ___________ _________ _________ Robert K. Jaedicke 54,191,902 773,181 - Paul J. Phoenix 54,274,707 690,376 - Francesca Ruiz de Luzuriaga 54,214,534 750,549 - Frank A. Shrontz 54,274,355 690,728 - Ward W. Woods, Jr. 53,753,082 1,212,001 - ___________ _________ 270,708,580 4,116,835 Continuing in office are Anne L. Armstrong, Philip J. Carroll, Rakesh Gangwal, Gary G. Michael, and A. William Reynolds, whose terms expire in 2001, and Edward E. Hagenlocker, George J. Harad, Donald S. Macdonald, and Jane E. Shaw, whose terms expire in 2000. The shareholders also ratified the appointment of Arthur Andersen LLP as our independent auditor for the year 1999 with 54,394,291 votes cast for, 341,001 against, and 229,791 abstained. ITEM 5. OTHER INFORMATION ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K (a) Exhibits. Required exhibits are listed in the Index to Exhibits and are incorporated by reference. (b) Reports on Form 8-K. No Form 8-Ks were filed during the first quarter of 1999. SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this amendment to be signed on its behalf by the undersigned thereunto duly authorized. BOISE CASCADE CORPORATION As Duly Authorized Officer and Chief Accounting Officer: /s/ Tom E. Carlile __________________________ Tom E. Carlile Vice President and Controller Date: October 14, 1999 BOISE CASCADE CORPORATION INDEX TO EXHIBITS Filed With the Quarterly Report on Form 10-Q/A for the Quarter Ended March 31, 1999 Number Description Page Number ______ ___________ ___________ 11 Computation of Per Share Earnings 12 Ratio of Earnings to Fixed Charges 12A Ratio of Earnings to Combined Fixed Charges and Preferred Dividend Requirements 27 Financial Data Schedule

EXHIBIT 11 Boise Cascade Corporation Computation of Per Share Earnings Three Months Ended March 31 _______________________ 1999 1998 _________ _________ (expressed in thousands, except per share amounts) Net income (loss) as reported, before cumulative effect of accounting change $ 16,153 $ (450) Preferred dividends (3,490) (5,061) Excess of Series F Preferred Stock redemption price over carrying value - (3,958) _________ _________ Basic income (loss) before cumulative effect of accounting change 12,663 (9,469) Cumulative effect of accounting change - (8,590) _________ _________ Basic income (loss) $ 12,663 $ (18,059) ========= ========= Basic income (loss) before cumulative effect of accounting change $ 12,663 $ (9,469) Preferred dividends eliminated 3,490 3,620 Supplemental ESOP contribution (2,983) (3,094) _________ _________ Diluted income (loss) before cumulative effect of accounting change 13,170 (8,943) Cumulative effect of accounting change - (8,590) _________ _________ Diluted income (loss) $ 13,170 $ (17,533) ========= ========= Average shares outstanding used to determine basic income (loss) per common share 56,369 56,242 Stock options, net 235 242 Series D convertible preferred stock 4,276 4,461 _________ _________ Average shares used to determine diluted income (loss) per common share 60,880 60,945 ========= ========= Net income (loss) per common share Basic income (loss) before cumulative affect of accounting change $ .23 $ (.17) Cumulative affect of accounting change - (.15) ______ ______ Basic net income (loss) per common share $ .23 $ (.32) ====== ====== Diluted income (loss) before cumulative effect of accounting change $ .22 $ (.15)(1) Cumulative affect of accounting change - (.14)(1) ______ ______ Diluted net income (loss) per common share $ .22 $ (.29)(1) ====== ====== (1) Because the computation of diluted loss per common share was antidilutive, the diluted loss per common share reported for the three months ended March 1, 1998, was the same as basic loss per common share.

EXHIBIT 12 BOISE CASCADE CORPORATION AND SUBSIDIARIES Ratio of Earnings to Fixed Charges Three Months Year Ended December 31 Ended March 31 _________________________________________________________ ______________________ 1994 1995 1996 1997 1998 1998 1999 _________ _________ _________ _________ _________ _________ _________ (dollar amounts expressed in thousands) Interest costs $ 169,170 $ 154,469 $ 146,234 $ 153,691 $ 174,541 $ 43,824 $ 40,869 Interest capitalized during the period 1,630 3,549 17,778 10,575 1,341 68 61 Interest factor related to noncapitalized leases(1) 9,161 8,600 12,982 11,931 11,308 2,851 2,998 _________ _________ _________ _________ _________ _________ _________ Total fixed charges $ 179,961 $ 166,618 $ 176,994 $ 176,197 $ 187,190 $ 46,743 $ 43,928 Income (loss) before income taxes, minority interest, and cumulative effect of accounting change $ (64,750) $ 589,410 $ 31,340 $ (28,930) $ (16,878) $ 4,580 $ 33,535 Undistributed (earnings) losses of less than 50% owned persons, net of distributions received (1,110) (36,861) (1,290) 5,180 3,791 3,540 (746) Total fixed charges 179,961 166,618 176,994 176,197 187,190 46,743 43,928 Less: Interest capitalized (1,630) (3,549) (17,778) (10,575) (1,341) (68) (61) Guarantee of interest on ESOP debt (20,717) (19,339) (17,874) (16,341) (14,671) (3,724) (3,279) _________ _________ _________ _________ _________ _________ _________ Total earnings before fixed charges $ 91,754 $ 696,279 $ 171,392 $ 125,531 $ 158,091 $ 51,071 $ 73,377 Ratio of earnings to fixed charges - 4.18 - - - 1.09 1.67 Excess of fixed charges over earnings before fixed charges $ 88,207 $ - $ 5,602 $ 50,666 $ 29,099 - - (1) Interest expense for operating leases with terms of one year or longer is based on an imputed interest rate for each lease.

EXHIBIT 12A BOISE CASCADE CORPORATION AND SUBSIDIARIES Ratio of Earnings to Combined Fixed Charges and Preferred Dividend Requirements Three Months Year Ended December 31 Ended March 31 _________________________________________________________ ______________________ 1994 1995 1996 1997 1998 1998 1999 _________ _________ _________ _________ _________ _________ _________ (dollar amounts expressed in thousands) Interest costs $ 169,170 $ 154,469 $ 146,234 $ 153,691 $ 174,541 $ 43,824 $ 40,869 Interest capitalized during the period 1,630 3,549 17,778 10,575 1,341 68 61 Interest factor related to noncapitalized leases(1) 9,161 8,600 12,982 11,931 11,308 2,851 2,998 Preferred stock dividend requirements - pretax 81,876 59,850 65,207 44,686 19,940 25,930 8,754 _________ _________ _________ _________ _________ _________ _________ Combined fixed charges and preferred dividend requirements $ 261,837 $ 226,468 $ 242,201 $ 220,883 $ 207,130 $ 72,673 $ 52,682 Income (loss) before income taxes, minority interest, and cumulative effect of accounting change $ (64,750) $ 589,410 $ 31,340 $ (28,930) $ (16,878) $ 4,580 $ 33,535 Undistributed (earnings) losses of less than 50% owned persons, net of distributions received (1,110) (36,861) (1,290) 5,180 3,791 3,540 (746) Combined fixed charges and preferred dividend requirements 261,837 226,468 242,201 220,883 207,130 72,673 52,682 Less: Interest capitalized (1,630) (3,549) (17,778) (10,575) (1,341) (68) (61) Guarantee of interest on ESOP debt (20,717) (19,339) (17,874) (16,341) (14,671) (3,724) (3,279) _________ _________ _________ _________ _________ _________ _________ Total earnings before combined fixed charges and preferred dividend requirements $ 173,630 $ 756,129 $ 236,599 $ 170,217 $ 178,031 $ 77,001 $ 82,131 Ratio of earnings to combined fixed charges and preferred dividend requirements - 3.34 - - - 1.06 1.56 Excess of combined fixed charges and preferred dividend requirements over earnings before combined fixed charges and preferred dividend requirements $ 88,207 $ - $ 5,602 $ 50,666 $ 29,099 - - (1) Interest expense for operating leases with terms of one year or longer is based on an imputed interest rate for each lease.

5 EXHIBIT 27 The data schedule contains summary financial information extracted from Boise Cascade Corporation's Balance Sheet at March 31, 1999, and from its Statement of Income for the three months ended March 31, 1999. The information presented is qualified in its entirety by reference to such financial statements.

3-MOS DEC-31-1999 MAR-31-1999 48,526 8,349 592,746 10,411 561,490 1,370,448 5,021,965 2,197,160 4,949,684 1,150,088 1,703,758 0 235,644 140,978 1,048,826 4,949,684 1,611,153 1,611,153 1,322,658 1,541,907 0 0 37,117 33,535 (14,043) 16,153 0 0 0 16,153 .23 .22